Reviving Housing Bubble Final Anti-Speculation Devices Should Be Left Intact Following a series of moves to deregulate property markets, the government appears set t remove final devices suppressing real estate speculaion. Minister of Land, Transport and Maritime Affairs Chung Jong-hwan said Wednesday his ministry is considering doing away with the "three major regulations" on property Seoul districts from being anti-speculation zones, and exempting capital gains tax on buyers of unsold apartments in the provinces for five years. The government's anxiety to prevent the free fall of the economy is understand able, but officials should reconsider the proposed paln, as its benefits, if there are any, will be shout-lived while the adverse effects could be enormous and last for a long time. Seoul seems to have learned little from Japan's lost decade. But government officials need t look no further back than the former Kim Dae-jung administration, which abolished almost all regulations on property speculation problems to its successor, the Roh Moo-hyun administration, forcing the latter to spend most of its tenure fighting asset bubbles nd introducing a very strong set of anti-speculative regulations. Government officials say these regulation are against free market principles and have lost most of their relevance, noting a price ceiiling is meaningless in times of an extreme property market slump like now. They oly have to visit any real estate agency in posh residential quarters in southern Seoul to see resurging home prices, particularly since the ministry hinted at allowing the construction of high-rise apartments alon the Han River. The officials also say they can always put the price cap back upon any signs of revival of speculation. Experienced realtors know, however, while it is easy to make home prices soar, the opposite case is very hard. They should know it was thanks to Korea's peculiar anti-speculative devices lke strict loan-to-value ratio and debt-to-income ratio applied on housing loans that kept thenation from falling into the U.S.-style housing bubble and consequent subprime mortgage crisis. Why follow th footsteps of someone who almost fell over a precipice? The ministry's plan also poorly fits with President Lee myung-bak's ephasis that any governmental stimulus should also take the post-crisis situation into account. Currently, thy may have to worry about asset deflation, ut when the crisis eases and inflation sets in, the rekindled property specultion would prove to be out of their control. Most of all, the deregulatory scheme is class-discriminating, as runaway prices will put most new homes further out of reach of the working class and deepening their sense of relatve deprivation, while virtually encouraging speculation for a small number of well-heeled people through tax-free deals in most of the country. This may further stigmatize the Lee administration as the "governement for the haves," while running squarely counter to the slogans of the governing Grand National Party as the "party for working-class people." The officials ought to ponder why even their most fervent ideological support group, the "New Rightists' Union," opposed the deregulation plan. Last but not least, construction as a stimulus is not bad by itself but is it the only way this governmet knows?